Energy Brokering

SETTING UP AN OIL BUYING CLUB

NI Fuel Poverty & Oil Dependence• Oil dependence is one of the key reasons why NI has the highest

incidence of Fuel Poverty in NI

• ~63% NI households use oil as the main source of fuel

• Costs of heating an average 3 bedroom house with oil approx 30% more than with natural gas

• £1,573 - non condensing oil boiler or £1,093 – condensing gas boiler*

• A typical 3 bedroom semi-detached house will take around 2,000 - 2,700 litres of oil a year to heat the house adequately (depending on oil boiler) *

• Many households under use fuel because they cannot afford it

* Sutherland Heat Cost Tables October 2013

How An Oil Club Works

• An order is made for the total amount of oil.

• Payment for oil does not go through the oil club – people continue to pay their supplier as before and can pay using oil savings stamps if they wish.

• The club gives members collective bargaining power to negotiate with the oil delivery suppliers for the cheapest price based on the total oil order.

• Oil suppliers benefit from fewer goods vehicle movements - a full tanker can get as little as 8 miles per gallon. If deliveries are organised so that a tanker delivers to several customers in the same area, the tanker’s fuel consumption is reduced.

How An Oil Club Works

• Oil Clubs work best when it has members who can afford to place larger orders (e.g. 900 litres) as well as those members who can only afford smaller orders (e.g. 300 litres).

• Everyone gets the oil at the same price per litre regardless of the size of their order.

• Usually oil clubs will place an order once a month and will set a deadline for members to get their orders to the co-ordinator.

• Since the establishment of East Belfast/Cregagh Oil Club in September 2013, over 200 members have joined: 7 bulk orders have been placed for 156 households: Group savings of £2,411.21; Average savings of £15.46 per order.

How To Start up An Oil Club • Arrange a public meeting about the advantages of setting up an oil

buying club

• Agree membership Terms & Conditions

• Elect Chairperson, Treasurer and Secretary & Volunteers

• Create memberships forms and promote club

• Set the buy date – usually at the end of every month

• Set a deadline for members to get their orders to the co-ordinator.

• Collate the total amount of orders

• Research oil prices prior to the bulk buy

• Negotiate the cheapest price possible for the bulk order

How To Start up An Oil Club • Confirm to all those members who ordered, the name of the

successful oil supplier and the price per litre that was negotiated

• Email the order list spreadsheet to the successful oil supplier

• Oil supplier will contact the members on the spreadsheet to arrange payment and deliveries

• Inform the members / local paper of the total oil club buy and the money that was saved – to help promote the club

• Keep accurate records of all monthly oil club buys etc on a spreadsheet and keep a back up copy as a safety measure.

• Alert the members to the number of days to the next big oil buy then repeat process

Statistics• 1st Oil buy was on Friday the 20th September 2013• 214 community oil club buying members joined (165 East

Belfast + 49 North Belfast)• 111,775 litres of oil ordered through the club (20,300 in North

Belfast + 91,475 in East Belfast)

91,475

20,300

111,775 litres of Oil Ordered

East BelfastNorth Belfast

Statistics• 226 Households got cheaper oil prices through 8 oil club bulk

buys (27 in North Belfast + 199 in East Belfast)

199

27

226 Households

East BelfastNorth Belfast

Statistics• 40 Households got cheaper oil prices through individual

brokering (9 in North Belfast + 31 in East Belfast)

• Members savings to date: £3,962.56 (Average - £14.90)

• Average savings to date: 4.57p per litre

£3,435.41

£527.15

£3,962.56 Savings

East BelfastNorth Belfast